Investment overhang spells trouble for China

Persistently high levels of investment are producing diminishing returns and may signal a correction.
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China needs to focus on more productive investments
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<div style="text-align: left;"> China needs to focus on more productive investments </div>

You can’t keep a good China bull down. After a brief flirtation with notions of a hard landing, the conventional wisdom now has it that China is poised to resume its inexorable rise to global superpower.

It is not entirely clear why the mood has changed. China has a new deck of leaders, as nobody could have failed to notice, but they are hardly very different from the old ones and, in the meantime, the country’s other problems haven’t gone away.

Questionable accounting, unaffordable housing, tainted food and corrupt officials are all proving hard to resolve. There is...

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